Daily Forecast - 23/3/2010

By IBT Staff Reporter On 03/22/10 AT 5:37 PM

:: Australian Dollar: The Aussie dollar continued to slide in early offshore exchange dipping below the 91 cent handle as division over a clear strategy on European sovereign debt persisted. Comments by the German Chancellor Merkel that investors shouldn't expect resolution this week dampened risk appetite early, driving the AUD/USD lower however ECB President Trichet provided some respite following more promising rhetoric sparking a turnaround in the Aussie dollars fortunes. This morning sees the AUD open on its highs around 0.9175 with further topside moves expected to be limited to around 92 cents with some volatility expected around the release of the BoJ minutes in Asia today.

:: Great Britain Pound: Overnight the Pound rose from 1.4930 against the Greenback as European leaders debated what financial aid mechanisms may be needed to support Greece. The Confederation of British Industry said economic recovery will be 'slow and sluggish' predicting 1% growth this year but this seemed to have little effect on the Cable. The Sterling opens today on 1.5100 against the Greenback and at 1.6450 versus the Aussie ahead of this evenings UK CPI and realised sales data.

- We expect a range today in the GBP/AUD rate of 1.6385 to 1.6485

:: New Zealand Dollar: The Kiwi dollar traded in a V like formation overnight dropping from 0.7060 to 0.7000 only to bounce straight back to open this morning at 0.7060. With no New Zealand economic data releases scheduled until tomorrow's current account the NZD tracked movements in commodities and general risk appetite. With the Aussie dollar opening this morning higher than yesterdays Asian close the AUD/NZD cross rate also opens higher near 1.3 at 1.2980.

- We expect a range today in the NZD/USD rate of 0.7035 to 0.7100

:: Majors: Overnight the Euro fell to 1.3465 against the US Dollar as Greece continues to throw threats at the European Union pressuring the EU to formulate a financial aid mechanism. The Euro dropped after Deputy Prime Minister Pangalos said the Euro may fail if European leaders don't decide quickly while German Chancellor Merkel said investors should not expect a resolution this week. Meanwhile the Japanese Yen remains range bound around the 90 mark ahead of today's monetary policy meeting minute release. Today the Euro opens 1.3550 and Yen at 90.135 against the US.